Detroit should have gone "cold turkey"

[Willi]

An interesting take on why Detroit will continue to FAIL.
Many great in-depth insights to why Detroit is still drunk and stumbling.

http://www.entrepreneur.com/article/227509

[YounginDetroit]

I liked this article, though Im as pro-Detroit as you can get, its true Detroit has to figure out a way to get out of its 1950s economic mindset. I understand that unions were necessary to begin with but what theyve grown to be is embarassing. Detroit needs to learn to become competitive in a business sense. Sayin Detroit would never recover is a little harse given that the city is going throhgh such a massive change right now. But I get his point I think will figure out a way to learn from its mistakes and soon. But when he refered to Detroit becoming that brother in law who does nothing but borrowmoney its true, but that was the old Detroit better times are ahead.....hopefhlly

[313WX]

I completely agree with the sentiment of that article.

Unless you're making good money at the Big 3 and nearing retirement, or unless you graduate from one of Michigan's universities with a high GPA and a STEM degree, it's best to get out of Detroit and Michigan right now. Its best days are behind it.

[wazootyman]

I completely agree with the sentiment of that article.

Unless you're making good money at the Big 3 and nearing retirement, or unless you graduate from one of Michigan's universities with a high GPA and a STEM degree, it's best to get out of Detroit and Michigan right now. Its best days are behind it.

Out of curiosity, where do you propose to move to?

[313WX]

Out of curiosity, where do you propose to move to?

Any growing place with a diverse economy...

[anonJD]

I completely agree with the sentiment of that article.

Unless you're making good money at the Big 3 and nearing retirement, or unless you graduate from one of Michigan's universities with a high GPA and a STEM degree, it's best to get out of Detroit and Michigan right now. Its best days are behind it.

It reminds me of a headline in U. of Michigan's humor newspaper: "We Need to Revialize Detroit," says student taking job in New York City

The top students at U. of Michigan and to a lesser degree, MSU, are being rushed by companies in California, DC, New York, Chicago and down South. You do the pros and cons of these sexy locations to Detroit and Detroit loses every time. The kids in the bottom half of their classes and the kids without the means to flee are largely the ones sticking in Michigan. That is not a promising outlook.

And you're right about those nearing retirement. Once they do retire, they're fleeing to Florida or Arizona and the kids ain't coming back. Detroit's future is very bleak unless something REALLY drastic happens to spark growth. It can not compete with Chicago. Period. And it's decades away from competing with Pittsburgh, which took 30 years to make a come back.

[BankruptcyGuy]

It reminds me of a headline in U. of Michigan's humor newspaper: "We Need to Revialize Detroit," says student taking job in New York City

The top students at U. of Michigan and to a lesser degree, MSU, are being rushed by companies in California, DC, New York, Chicago and down South. You do the pros and cons of these sexy locations to Detroit and Detroit loses every time. The kids in the bottom half of their classes and the kids without the means to flee are largely the ones sticking in Michigan. That is not a promising outlook.

And you're right about those nearing retirement. Once they do retire, they're fleeing to Florida or Arizona and the kids ain't coming back. Detroit's future is very bleak unless something REALLY drastic happens to spark growth. It can not compete with Chicago. Period. And it's decades away from competing with Pittsburgh, which took 30 years to make a come back.

As the kids say, "not sure if serious."

The "kids" who move to Florida to follow their retiring parents [[who's ever heard of such a thing?) probably realize that paying teachers $25,000 per year doesn't result in the best education for their children. Pittsburgh? Let's just say I guess we'll see about that.

As I've mentioned, 19 of the nation's largest cities would have lost population if it wasn't for first generation immigrants. That includes Chicago, Los Angeles and New York.

Young people follow jobs, period. It's not the "sexiness" of the city, and it never has been. Richard Florida made that argument to Jennifer Granholm [[remember Cool Cities?). It was wrong then, and it's wrong now.

Detroit is in revival because of the relocation of white collar jobs to the City's core. When CA and IL recognize their pension problem, it will result in either massive tax increases or reductions in services, just like what happened to Detroit 20 years ago. And employers have and will leave, just like 20 years ago.

What happens next is what's important. Does Detroit continue its momentum, or do we reverse field and impose job-killing policies that existed in the past?

The future is as bright as it's been in Detroit in 50 years. Anyone who can see that is too busy reading epitaphs in national magazines.

[anonJD]

1.) Young people follow jobs, period. It's not the "sexiness" of the city, and it never has been.

2.) When CA and IL recognize their pension problem, it will result in either massive tax increases or reductions in services, just like what happened to Detroit 20 years ago. And employers have and will leave, just like 20 years ago.

1) Wrong, period.

2) Chicago is freaking BOOMING. Construction around the loop is insane. You keep holding your breath for this pension problem to blow it up though.

3) Pittsburgh is exponentially healthier than Detroit right now, in case you didn't know.

[Eber Brock Ward]

1) Wrong, period.

2) Chicago is freaking BOOMING. Construction around the loop is insane. You keep holding your breath for this pension problem to blow it up though.

http://www.chicagobusiness.com/artic...t-burden-grows

He [[or she) wasn't exaggerating at all. Chicago and Illinois are in dire straits.

[BankruptcyGuy]

1) Wrong, period.

2) Chicago is freaking BOOMING. Construction around the loop is insane. You keep holding your breath for this pension problem to blow it up though.

3) Pittsburgh is exponentially healthier than Detroit right now, in case you didn't know.

1. It's your American right to believe what you want to believe, no matter how foolish.

2. Downtown Chicago's office vacancy rate is 14% [[as of March).http://www.chicagobusiness.com/reale...-vacancy-rises

Detroit's was 11.5% as of the same period. http://www.crainsdetroit.com/article...7-7-percentage

But again, believe what you want to believe, even in the face of facts to the contrary.

3. How are you defining "healthy"? Pittsburgh is under the PA equivalent of an emergency manager. But again, don't let the facts bother you.
http://www.post-gazette.com/local/ci...s/201405130184

[iheartthed]

Young people follow jobs, period. It's not the "sexiness" of the city, and it never has been. Richard Florida made that argument to Jennifer Granholm [[remember Cool Cities?). It was wrong then, and it's wrong now.

Detroit is in revival because of the relocation of white collar jobs to the City's core. When CA and IL recognize their pension problem, it will result in either massive tax increases or reductions in services, just like what happened to Detroit 20 years ago. And employers have and will leave, just like 20 years ago.

I don't exactly agree with this. Why would companies need to move back to the urban cores if there is not a competitive incentive to do so?

[Lowell]

I don't exactly agree with this. Why would companies need to move back to the urban cores if there is not a competitive incentive to do so?

I think you are both right. Dan Gilbert has stated that his move of Quicken from Livonia to downtown was greatly influenced, maybe even predominately so, by the need to offer an exciting and stimulating work site setting for the types of young employees he was trying to attract after learning that many had turned down offers to go to more exciting places than an exit off 275.

Compensation packages are the main driving force and one will work in hell if the price is right. But how one spends his or her work day and what they walk out to for lunch or happy hour counts for a lot. Quicken has been quick to realize that and probably explains a big part of why they win those 'best places to work' awards.

[Detroitnerd]

I don't exactly agree with this. Why would companies need to move back to the urban cores if there is not a competitive incentive to do so?

I think there's a lot of willful misperception going on [[and some outright lying) when it comes to boomer [[and later generations') reactions to millennials and their shifting lifestyle choices.

They go where the jobs are.

More truthfully, they move across the country when they take a job. And since the jobs they're looking at are all over the country, they get to take their pick of environment when they take a job. People who don't mind humdrum, half-hearted urbanism pick Houston or Dallas [[not Detroit). People who want a mix of drivable and walkable pick places in Southern California to the southwest and to some extent southeast [[again, not Detroit). People who want tight, urban places with lots of choices pick the places that provide it, whether it's New York City, Boston, Austin, San Francisco, Portland, or what have you. Again, they don't pick Detroit.

The reaction to this is that insecure boomer who has to sell his house to meet his retirement goals saying, "People aren't moving to city centers." And, since it's not super-visible in metro Detroit, they're not nec. lying. They're just dismissing all the evidence that's come in on the most studied, most marketed-to generation ever. And it turns out they want jobs, good jobs, but not at any cost. They're really, really choosy, and not afraid to move across the country if that city's jobs meet their needs better. So young people do move into the city, just not here, and so it's not seen -- or acknowledged -- by metro Detroit boomers.

But the lie gets put to this when you talk about city residents who age. All of a sudden, they exist. They exist because, "When they have children, and they have to put those children in school, the suburbs are going to start looking pretty good to them!!!"

See? All those young people living in the city begin to exist when they turn 30, or when their children turn 5. That's when our suburban naysayers acknowledge them.

So, they're willfully blind to anybody living downtown, anywhere. Until those people become old enough and have enough money to buy their houses from them so they can move to -- largely -- the same places those young people are moving. [[For jobs … heheheheh).

[Hypestyles]

free enterprise relocated factories thousands of miles away- so went the jobs. Yay capitalism.

[Honky Tonk]

free enterprise relocated factories thousands of miles away- so went the jobs. Yay capitalism.

AND the tax revenues. But let's increase mine, and tax retirees, so people can have free water and housing, and TGG can get a free bus ride.

[Scottathew]

AND the tax revenues. But let's increase mine, and tax retirees, so people can have free water and housing, and TGG can get a free bus ride.

Exactly what I was thinking while reading the article. Although, I don't think wholly subsidizing mass transit would be a bad idea. It might be much less expensive than funding road improvements.

[Willi]

It's easy to be optimistic, cheerlead, and say nice things about Detroit, but the article got to the heart of the matter , the harsh reality of many its woes, and spoke the truth about Detroit.
Great article for discussion, a catalyst for change.

[FormerDetroiter]

This article needs to be updated. It was written 7/19/2013. Although I'm no longer in Detroit to observe what's been happening. I do read and I have many friends and family member there who keep me informed.

[BankruptcyGuy]

I think the article was a little simplistic. Detroit is not nearly the only city with obstinate public employee unions. And Detroit's population loss was exacerbated by a lack of first-generation immigrants; I read a study that showed that 19 of the 20 largest cities in the United States would have lost population would it have not been for an influx of first generation immigrants.

I think the financial stability board will do more to help Detroit than people think. New York [[which is a heavily-union town as well) relied on it to keep spending in check. One of the biggest changes will be that Detroit can no longer accelerate revenue, defer expenses or rely on capital sales to balance its budget. If revenue is down, expenses will have to follow. How Duggan handles that will be the most interesting issue in Detroit over the next 10 years.

[iheartthed]

I think the article was a little simplistic. Detroit is not nearly the only city with obstinate public employee unions. And Detroit's population loss was exacerbated by a lack of first-generation immigrants; I read a study that showed that 19 of the 20 largest cities in the United States would have lost population would it have not been for an influx of first generation immigrants.

I think the financial stability board will do more to help Detroit than people think. New York [[which is a heavily-union town as well) relied on it to keep spending in check. One of the biggest changes will be that Detroit can no longer accelerate revenue, defer expenses or rely on capital sales to balance its budget. If revenue is down, expenses will have to follow. How Duggan handles that will be the most interesting issue in Detroit over the next 10 years.

I agree with most of this comment. Particularly, if Detroit doesn't start to attract blood from outside the region then it does not have much hope for revival.

[casscorridor]

Calling this guy a charlatan would be an understatement.

[Lowell]

Simplistic indeed. The author muddles Detroit [synonym for the American auto industry] and Detroit [Metro Detroit] and throws their problems on Detroit [the City of].

The Detroit [city] failed in terms of bankruptcy because its revenue didn't keep up with its costs. What he ignores is that this was fueled by its tax-generating middle class and businesses moving away to Detroit [Metro Detroit outside the city] and the decline Detroit's [American auto industry] product quality. Detroit [city] bears some blame at the leadership level but it is relatively minor compared to the above factors.

These event left Detroit [city] in the care of Detroit's [metro] non-taxpaying but tax-consuming poor, disabled, felon and ex-felon population. If this imbalance is not addressed Detroit [city] will fail again.

The author never mentions that 300K population elephant in the room. Instead he can only offer:

The hard choices of lower salaries, reduced services, trimmed pensions and re-investment need to me [sic] made, but it looks like there is little political will to achieve those ends.

Sorry, been there, done that and you can keep doing that until you hit minimum wage and it still won't keep up with the cost servicing those in need who cannot pay.

[corktownyuppie]

Simplistic indeed. The author muddles Detroit [synonym for the American auto industry] and Detroit [Metro Detroit] and throws their problems on Detroit [the City of].

The Detroit [city] failed in terms of bankruptcy because its revenue didn't keep up with its costs. What he ignores is that this was fueled by its tax-generating middle class and businesses moving away to Detroit [Metro Detroit outside the city] and the decline Detroit's [American auto industry] product quality. Detroit [city] bears some blame at the leadership level but it is relatively minor compare to the above factors.

Good points. If we were talking about the Metro Detroit region as compared to the city of Detroit, you'll see that in aggregate, we are actually in pretty good shape economically.

But as you mentioned...

These event left Detroit [city] in the care of Detroit's [metro] non-taxpaying but tax-consuming poor, disabled, felon and ex-felon population. If this imbalance is not addressed Detroit [city] will fail again.

I alluded to this in previous posts, but I'll state it more concisely. Battling this is a 2 step process:

[[1) The city cannot be ruled by criminals and those who are consuming more than producing. The Financial Stability Board is the solution to this, though it doesn't get a lot of airplay. [[for example, can anyone name even 2 people on the board?) But they will be the hammer that puts a stop to any of the nonsense from the past.

[[2) Then people need to remediated to become productive members of society, or they will have to leave or get left behind. In South Dakota, you can now make $20/hr. working at McDonald's in the new oil production cities of northern US regions. The opportunities to be uneducated and make a healthy income exist. But they don't exist here and will not for a very long time, if ever.

[tfrodent]

[QUOTE=Lowell;455706]Simplistic indeed. The author muddles Detroit [synonym for the American auto industry] and Detroit [Metro Detroit] and throws their problems on Detroit [the City of].

Absolutely! The author of this actually extremely lame article simply set up a straw man and then set forth his simplistic agenda. It's just about 100% devoid of actual substance. "Detroit Journalism" is especially afflicted with this kind of setup, to justify/rationalize what's generally an extreme Republican agenda.

[Hermod]

This is why Franklin D. Roosevelt, labor's friend, was opposed to public employee unions.